Kris Naudts has an unusual background for a founder of one of the UK’s fastest-growing startups. Although he was born into a Belgian family of entrepreneurs (his father and two brothers all started their own businesses), he became a psychiatrist, practising in Ghent and London.
But in 2011 at the age of 38, his entrepreneurial genes kicked in and he founded Culture Trip, reflecting his interests in literature and travel. The site now employs 300 people in London, Tel Aviv and New York.
He sat down with Sifted recently to talk about how his training as a psychiatrist helped him be a better entrepreneur, how he coped with a bruising public fight with disgruntled ex-employees, how he aims to reinvent the travel business and how China’s rise will change global culture.
Why did you want to start a business?
I trained as a medical doctor and a psychiatrist. But I always had a very strong entrepreneurial drive. I have always had a passion for creativity and technology. Putting these two together around a business proposition seemed very interesting to me.
What was the ‘creation story’ for Culture Trip?
I had the desire to build something. The genesis was that I love reading books, still do. I would seek out books of fiction about places I would travel to. But if you wanted to find a book about Armenia, say, that was not so easy, let alone finding a good creative selection of them. I ended up spending a lot of time in Waterstones, I think I lived there for about three weeks or so. I harassed them asking if you want to find a book by an author from Mozambique how would you do that? So we got bibliographic data for these books. Then we wrote a very simple algorithm to search the synopsis of the book. In combination with the ISBN number, we could then organise all this data by country and genre and people could buy books. Was that a business? No way. There is a big bookstore out there called Amazon, right?
So how did it develop from there?
What followed were four years of survival focused on trial and error, studying maniacally the worlds of media, entertainment, travel and tech. I had some delusional confidence that I would work it out. What evidence did I have for that? Some. The number of users grew. But equally every three months the money ran out. It was hardcore. It made you think outside the box.
“Booking.com is a massive hyper-efficient booking platform. But it is not a creative inspiration.”
How did you create a sustainable business?
We started adding and adding and adding content. It was only in the last six months that we started to remove and focus and focus and focus. We needed to expand extremely widely to see the full picture of the opportunity but then you need to focus.
What is the one-sentence summary of your business?
We have been putting a tattoo on the internet. I mean that very seriously. We write about all things cultural – and for us culture is life. In media terms this would be travel, food, art, all these supplement verticals that you find in a newspaper. I always saw that as our core business. Maybe one day we would arrive at news but we would start with the back pages because they were more monetisable. Whenever anyone searched for any of those verticals in combination with the name of a destination we would show up. I had confidence that if you could do that you would have a permanent billboard. It was all about pure content.
You can build a business if you’re hyper-curated and high quality. That is possible. But you cannot build a $1bn business like that, I do believe. So the focus was always on the way of scaling quality. Not New York Times or FT style maybe. But many times better than other publications. We have only had an SEO [search engine optimisation] team for a year or so. It was all organic content.
Where would you go and find 50 decent articles on Rwanda? We didn’t realise this at the time but lifestyle content matures. News content doesn’t: it depreciates overnight. So you see top-performing articles sometimes only after three or four years. If we literally stopped everything today we would still have a growing audience for a few more years. The articles are all still sitting on their maturity curve.
“We have a bigger audience than Lonely Planet or Time Out… If [our company] continues to work, this can be an IPO-able business.”
Who creates the content?
I was a walking encyclopaedia of works of fiction. The first 3,000 articles or so more or less came out of my head. These were funny days. I would sit in a museum shops and look at the backs of books and write down all the non-Caucasian names and put that in the commissioning structure. If we found an artist from Burundi, say, and we wrote about them on Culture Trip then we would immediately have credibility with readers in Burundi. Coming totally from outside the industry I had no reverence for any model. If you have no money then the one thing you have is thinking time — and stress. I would constantly look and look and look and see if anyone had a model that scaled. A breakthrough moment was watching an early TED talk by Jimmy Wales, the Wikipedia founder. If people have a good cause and a good mission they will contribute to that. And their user growth was phenomenal. I realised I needed a distributed community. I realised that this was never going to scale in-house.
You need to have money to feed the creative machine. If you don’t do that you’re a charity and will need donations. We have a small in-house team overseeing a community, being directive in what we want from that community and then becoming more bi-directional over time. We constantly looked at the data. I saw that visual content was more appealing. You write about food and you’re off. We managed to get to 1m monthly users in these first four years. We scraped through with seed funding and then scaled everything that worked.
You raised $2m in 2015. Who did that come from?
From seed investors and Gordy Crawford, a big name in media. I had been stalking that guy for years. I have never in my whole life sold anything, I have only told people what I am doing.
How did you pick your investors?
A founder is only a single individual with resilience and vision. But you also need a certain magic in your team. If you don’t have it, it’s not going to happen. But equally you need visionary investors. There are good ones out there. They say a founder sees things that others can’t. The same applies to investors. Gordy said that he thought my model had legs and that monetisation was an absolute no-brainer. It was only a question of when you would switch it on.
If you put a tattoo on the internet in all these lifestyle verticals in an organic, proper way that scales, who can’t monetise that? Imagine that everyone who Googles ‘art in Barcelona’ ends up at Culture Trip, or at least a good chunk, then you have monetisable intent. And it’s up to you to figure out how to monetise that intent. For news that intent is not inherently monetisable.
How do you become viral?
We were playing a patient, methodical game of putting out a tonne of good content over years without anyone realising we were doing. There is no other answer to that. It is a question of tenacity and data.
Some people said we were trying to do too much. But there are 200 countries and there are 10 verticals, art and fashion and food and so on, and that is doable.
I had no reverence whatsoever for the laws of gravity that the industry has internalised.
How did you create magic in the team? Did it help being a psychiatrist?
You don’t know at the beginning what you’re looking for but you meet certain magical people along the way. And then you meet people who you think are magical but aren’t.
So the secret is to find magical people and hire them, right?
Yes. It’s as simple as that but that’s not simple. What makes it magical in year two might not be the same as in year seven. Most founders are more ‘why not’ people rather than ‘what if’ people. So in the early years I would be more risk taking in my hiring. But now I have become far more risk averse because now I can see that there is something to ruin. You use psychiatry but it’s not failsafe at all.
Did you hire differently because you were a psychiatrist?
Yes, I would say so. But there are two other factors that override that. For years we would hire as good as we could find or afford. What can you do? Sheryl Sandberg was not going to join, right? But still you find amazing people. You have people living outside the box. Then when you are funded you have to grow — or perish. That means you are racing against the clock to add enough value for your next round. So your hiring is informed by speed.
How did you raise your next round?
After our seed round we had nine months of life, which meant we only had five months because you’re going to spend at least four months raising your next round. But the great thing was that whatever we had theorised about all worked. I had a model with a little more data. Then there was a fair bit of interest. I was going in for a $20m [round], which was a lot for a ragtag business.
Were you generating revenue at that point?
I would say zero point zero. We had arguments about how much to raise. I said of course it’s going to be easier to raise $5m or $7m or $8m but that’s not meaningful and not going to change anything. We’re going to have another bit of data and we’re going to be in the trenches again to raise another $10m. I said if it’s going to fail let’s get on with it. Either this works and we’ll do a lot bigger round or it doesn’t work and let’s get on with our lives. Then we raised $20m in 2016, led by PPF.
I knew that $20m would give us a year and a half. Not one day have I felt that now we have it good. It also gave you even more sight of the opportunity and even more desire to go faster. You are not held hostage by your genes but you carry them and I am intensely frugal. I am intensely obsessed with not becoming smaller because of going too slow.
How do you scale empathy?
You scale what you know works. We did nothing but that. Of course, you don’t know what you don’t know. What I didn’t think about as much as we ought to have was that if you scale everything that works that’s wonderful but you need a support structure to hold up that growth. We just didn’t pay enough attention to that. Our content works and we know how our content works. So we said: let’s produce more content. We know that we need to solve some technological constraints so let’s build more engineering capacity.
As a founder, you raise a lot of money and suddenly there are three things that emerge in front of you that you need to pay attention to. But you don’t have the time to pay attention to all three. First, there are your products. Users don’t give a damn about what you are doing internally. They only care about your product. That’s non-negotiable. If you stop caring about that you’re dead. Second, you have raised a lot of money so you have to set up some corporate governance and pay a lot of attention to your investors. That’s also non-negotiable. The third one is the support structure and the culture and the articulation of that. It’s also non-negotiable but the bandwidth did not allow us to do all three. That caught up with us. And all of the summer I have done nothing but culture. And it’s been really interesting, really rewarding. I think there’s a big momentum in the company because we have articulated our culture. We had growing pains, deep ones. We got a fair amount of exposure over it. And you learn — you learn and you move on.
They say when you employ more than the Dunbar number of 150 people then direct personal relationships begin to break down. As a psychiatrist you must have been aware of that?
I was aware of it, but not aware that they were beginning to break down.
How do you scale to 1,000?
You go through difficult periods. You reflect and you think and you talk. You have to read about it and talk to people about it. How do you scale empathy? How do you scale culture? Is there a secret sauce here? What are we not doing; what am I not doing? How do you tackle this?
Then you hear a plethora of corroborative stories. Ours is not unique. You need to find a kind of Esperanto for all these people to speak. When I talk about scaling empathy, it is taking time to articulate that you are empathetic. I have yet to find a founder who does not care. It makes no sense. Of course you want to do right by your people and your company. But you make mistakes. And leaders make mistakes. And that is not to say that you can be negligent or careless. We are not. But you will still make mistakes and err on the side of taking certain risks.
What advice would you give to people in a similar position? How can you create institutional bandwidth?
I think you need to really safeguard and block out a certain proportion of your time on these matters. It is absolutely, totally non-negotiable. You need to talk that through with the company that you have bandwidth issues. That you guarantee that you care and that x amount of your time is going to go towards that no matter what. If you don’t have that bandwidth in your five working days you will find it in your Saturdays and Sundays. You talk to your investors and everyone else and say: this matters.
We grew ridiculously fast. Every company has those kinds of issues. But your own culture is unique. Every month you have to take stock as to how well you are doing. Don’t go all-in on culture because nothing else is going to happen then. But make time for it, articulate it and make clear it is a work in progress. We have worked on The Guide, which is a decent attempt to articulate what we are about. Then we started ramping up so fast that it became out of date and we didn’t refresh it. We have now created a new Field Guide. Visually it reflects the company we are. People here are very friendly. Every week I stand here and have a kick-off moment with the whole company and all the offices tune in. And we have new joiners stand up and introduce themselves and say where they’re coming from and tell us something about an interesting trip or a favourite destination. The person is nervous because they are in front of a few hundred people. But it has become a right of passage and everybody loves it. We also reintroduce people who have been here a year, or two years, or three years. They do the same thing. It’s part of our ritual. Rituals are important. What is interesting is that everyone says the same: it is the people who make it interesting to be here. The people are truly interesting.
There are challenges when you try to create your own Esperanto, there are challenges when you try to scale empathy but there is also an intellectual joy that is unrivalled. You walk around and people smile here. We grin at each other. If you don’t it’s almost like a sign that this is not your company. We are friendly, we are a quirky bunch. We feel a bit kicked around and beaten around by some others but we move on.
How did you react to reading hurtful things about you and the company?
You have no real preparation for such things. You also never speak to the people who write it. There was never a dialogue. Of course, it’s something you need to wrap your head around a little bit. If you enjoy being in the limelight then it will come with a price. If you enjoy the positives then you have more of a buffer for the negatives. I have no desire for the limelight. Anything I can do to help the company I will do. But I don’t inherently seek it or get any satisfaction out of it. So I am also less vaccinated against any possible negatives. Then you feel bad for the people who have had a bad experience. You don’t want that.
Ingenuity is important as a founder. You have to have an idea. You have to have a vision. But all of that pales against your ability to take the punches. Because you are going to get some punches, that is for sure. Being a psychiatrist gives you some perspective. Yes, it’s tough being a startup founder but it is still tougher to lose someone to illness. I never lost that perspective. As long as you keep your moral compass and learn from the mistakes you make – and I’ve made some for sure, never carelessly or negligently – then you take a deep introspective look and do your very best to do very, very much better. I have no other desire than to make this company a success and make people as happy as I possibly can make them at Culture Trip. That’s it. There’s nothing else to it. People can write whatever they want for the rest of their days. But I know that as clearly as the sun comes up tomorrow.
Do you want to sell out? To go public?
Culture Trip has the potential to be one of those websites that has very deep penetration across the world. If one in four internet searches has to do with travel then we’re in a happy demand industry and we are managing to meet it. We have emerged from the crowd. We have a bigger audience than Lonely Planet or Time Out, which are two amazing long-standing brands. In order to be sustainably successful long term, I believe we can’t do that by a business media model. In advertising there are others that do that better. We will never be able to do that as well as Google or Facebook. Subscriptions? Yes. Probably there is an element of subscription we could embrace. But that is not going to build you a long term, sustainable globally successful company. We are looking at travel as a model, where we can monetise intent and the data that we have around that. If that business continues to work then this can be an IPO-able business. If we cannot do that then, of course, we are an interesting acquisition play because we have the top of the funnel. People come to us to get inspired and to plan their trips. If we can’t monetise that then someone else probably will be able to. We’d always be open to that.
How do you make money out of me wanting to go to Tashkent, for example?
Ideally, you know Culture Trip has content for everywhere. You go to our app or our website and you start looking for stories, be it video or articles, to do with Tashkent. You enjoy that and start putting it into a wishlist. You start moving from being inspired to exploring Tashkent as a possible destination. What is that place really about? How can I go there? You start to build out your wishlist with content and stories that make clear that this trip is something you are concretely going to do. Then the booking should be an automatic thing to do on that platform. The brand then properly registers as a destination website. We have a unique opportunity here to be a one-stop platform where you do it all. Why? Because you can.
Booking.com is a massive hyper-efficient booking platform. But it is not a creative inspiration. The joys of travel lie in these early inspirational planning stages. Nobody has really successfully brought that online. The real life guidebooks industry has plummeted and has scattered over a million websites. So we are a newish thing that picks up all that demand. You know Lonely Planet, I know Lonely Planet, you may even still buy it as a ritual to look at the pictures. But there is not one millennial with any loyalty to these brands. They will start their journey in Search, Culture Trip will appear a few times. We hear these stories that young people in hostels in Asia, everybody knows Culture Trip. I always remember that the founder of Lonely Planet felt a moment of pride when he walked through an aeroplane and saw someone flicking through his guide. I have that too. It’s really quite nice.
You need to serve your users. You have employees as a stakeholder and investors as a stakeholder but we have to serve our users; we have 15m to 20m unique visitors every month. We have to help these people get inspired and travel the world. That’s not negotiable.
How do you see yourselves? Are you a media and entertainment company? Are you a travel company? Are a tech company? Are you a platform?
I think we are a tech company. I think everybody should be. I don’t think that Vice and Refinery29 are that. It’s not in their DNA. If you speak to Vice and ask them about the relative proportion of engineers they have. It’s low. Here, we aspire to one in four.
If you want to know the difference in DNA between Culture Trip and Lonely Planet then go to their offices and look at all the screens and see how much code you see. You will see no code, you will see words. Here, I like to think that you see a lot of code. But ultimately it’s a creative company. From a commercial perspective it’s a company that people use to travel. Its foundation is technology and creativity.
“A Chinese language website is one of the next big things we might want to do.”
Is it meaningful to talk about a Millennial mentality?
I think there are differences for sure. In life in general I focus on similarities more than differences. There are very interesting cultural differences and that’s what we build our business around. But there is a universality and communality in us as human beings and that goes across generations. There are some differences. They are more socially conscious, probably. They want to have an impact.
Is that a problem given that they are probably more environmentally aware and averse to travelling to distant places?
It’s not a problem. At Culture Trip we feel there is a challenge with over-tourism. By covering the whole world we hope we can distribute some of that tourism footfall. I don’t see that as an inherent, non-overcomeable challenge. In fact, I am very happy to have that generation in high numbers here so they can help us solve that going forward. They are not going to suddenly drop all their principles and they can help us think through what a sustainable travel company looks like.
What about China? Are you going to expand there?
They used to say that if you’re in Europe you have to go to the US. But if you want to be to global today you have to go to China too. There is no choice. Then you have to accept that there is not one global internet. You need to accept that there are three internets, American, European and Chinese. These are all different ecosystems. I do think that China is in a very fascinating spot AI-wise. As Kai-Fu Lee’s book demonstrates they are an emerging superpower. China is not on the rise; China has risen. We have to embrace what the world looks like. India is on a similar journey.
What I am fascinated by is what is China’s impact on global culture? This Anglo-Saxon, or western European, over-representation in the cultural vernacular and cultural/visual language is clearly not sustainable. I get beyond myself with excitement about what does that look like? What countries determine today what is cool fashion-wise? It is still UK, US, Japan to an extent. I am super-curious about what this world looks like. China has an exploratory appetite that needs to be fed. A Chinese language website is one of the next big things we might want to do.